About IMT 47 in Motor – Article by Mr. P.

Pandiyan, Chennai -98410-32566 –

pandiyan.p@gmail.com

IMT 47

There is a story about the opinion of an Elephant after observing it by four blind people. Similarly the opinion differs
from person to person about IMT 47. Hence I am interested to give my opinion (Perhaps, I am also one of the blind
persons about IMT 47). I now share on how I have felt or what I have understood about it.

In my personal opinion this endorsement has been made in a so complicated manner in the tariff. If it would have
been done as IMT 47-A, IMT 47-B, IMT 47-C as like the IMT 22 & IMT 22 A, there would have been no confusion at
all.

What is this Endorsement IMT 47? The verbatim from the Indian Motor Tariff is given below:

IMT 47:- Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies / Shovels / Grabs / Rippers
It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect
of the vehicle insured * the Insurer shall be under no liability

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the
operation as a tool of such vehicle or plant forming part of such vehicle or attached thereto except for loss or
damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.

b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in
respect of liability incurred by the insured arising out of the operation as a tool of such vehicle or of plant
forming part of such vehicle or attached thereto.

N.B. :
Omit paragraph (a) for :-
(i) Liability only Policies.
(ii) Package Policies Where an additional premium has been paid for inclusion of damage by overturning.

Note :
* Insert make, number or some other means of identification.

Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade omit from
paragraph (a) (the words “resulting from overturning” and “except for loss … or theft”.

The intention of the Underwriter is to consider the risk on the Equipment / Machinery / Vehicle while it is in operation
when there is possibility of shift of the centre of gravity which may cause over-turning of the equipment. It is an
additional risk and also very high risk compared with the other type of vehicles. Therefore the underwriter thought to
provide an additional coverage or exclude the cover for damage arising out of the operation of the vehicle as a tool of
trade. Please note here that this endorsement relates to only eight categories of vehicles/equipments said in the
heading (topic) of the Endorsement.

About TOOL OF TRADE:

If the Machine / Excavator is used for the specific purpose for which it is intended, it is called as TOOL of TRADE and
if it overturns during that time then the RISK is to be covered separately for certain machines. IMT 47 specifies such
machines and equipments. The Excavator is also one of the items comes under the IMT 47. When a tool is used for
the trade, it is called as Tool of Trade. For a medical practitioner (surgeon) scissor / knife are the tools of his trade.
For office assistant, scissor / knife are not the tool of trade.

What are all the Vehicles / equipments / Machine applicable for this? As said earlier, there are only eight Categories
of Vehicles / Equipments / Machinery and they are, Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies /
Shovels / Grabs / Rippers. All these vehicles come under Misc ‘D’ Class of vehicles.

Now, whether all the vehicles come under Miscellaneous ‘D’ Class vehicle are applicable to this endorsement? The
answer is "No".

There are 58 categories of vehicles in the Misc ‘D’ Category specified in the Tariff. All vehicles coming in Misc ‘D’ are
not applicable for this endorsement. But many of the Insurers and Surveyors are having confusion and also have a
myth that all "D" class vehicles are subject to be covered by this endorsement. But only eight categories are
subjected to IMT 47.

IMT 47 have three clauses. The under writer has to make necessary precaution while giving an Insurance Policy. But
many of the Insurers are just attaching IMT 47 as in the tariff without clear indication of the coverage/exclusion. Such
practice of just attaching or mentioning the IMT 47 along will not serve the purpose. IMT 47 is having two major
heads and they are, Third Party – Package Policy and Own damage portion. Again in own damage portion there are
three sub divisions. We are not discussing here about TP risks in detail, here.

IMT 47
 
           
TP Policy Package Policy - Own damage
 
   
Inclusion of Exclusion of
damage by damage by Exclusion of "all
"overturning" "overturning" damage" while in
while in while in operation as a
operation as a operation as a tool of trade
tool of trade tool of trade

The number IMT 47 is common for all the above. But this is used for atleast four situations as follows:

1. Paragraph (a) of the endorsement has to be removed totally for Liability only (TP) policy
2. Paragraph (a) has to be removed for Package policies where an additional premium has been paid for
inclusion of damage by overturning
3. Default imposing of IMT 47 where damage by overturning is not covered while in operation as a tool of trade
4. Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade , in Paragraph
(a), the words "resulting from overturning" and "except for loss……. or theft" have to be omitted

But practically, as said earlier, either the endorsement number is mentioned in the policy or in some cases the
endorsement on paper is attached with the policy without any striking off of the paragraphs concerned. And this sort
of practices by the Underwriters creates confusion at the time of a claim.

To term them in simple, the endorsement need to be sub-divided and is suggested to be like this:

IMT 47-A for Exclusion of damage by overturning whilst in operation as a tool of trade for Liability only Policies
IMT 47-B for Inclusion of overturning by overturning whilst in operation as a tool of trade
IMT 47-C for Exclusion of overturning by overturning whilst in operation as a tool of trade
IMT 47-D for Exclusion of all sorts of damage whilst in operation as a tool of trade

For Liability only policies, say IMT 47-A, it should be as follows:

IMT 47-A: Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies / Shovels / Grabs / Rippers

It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect
of the vehicle insured * the Insurer shall be under no liability

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the
operation as a tool of such vehicle or plant forming part of such vehicle or attached thereto except for loss or
damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.
b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in
respect of liability incurred by the insured arising out of the operation as a tool of such vehicle or of plant
forming part of such vehicle or attached thereto.

N.B. :
Omit paragraph (a) for :-
(i) Liability only Policies.
(ii) Package Policies Where an additional premium has been paid for inclusion of damage by overturning.

Note :
* Insert make, number or some other means of identification.

Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade omit from
paragraph (a) (the words “resulting from overturning” and “except for loss … or theft”.
Alternate wording: It is hereby declared and agreed notwithstanding anything to the contrary contained in this policy that in respect of the vehicle insured * the Insurer
shall be under no liability under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in respect of liability incurred by the
insured arising out of the operation as a tool of such vehicle or of plant forming part of such vehicle or attached thereto.

For Package Polices where an additional premium has been paid for inclusion of damage by overturning (Say
IMT 47-B):

IMT 47-B: Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies / Shovels / Grabs / Rippers

It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect
of the vehicle insured * the Insurer shall be under no liability

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the
operation as a tool of such vehicle or plant forming part of such vehicle or attached thereto except for loss or
damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.

b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in
respect of liability incurred by the insured arising out of the operation as a tool of such vehicle or of plant
forming part of such vehicle or attached thereto.

N.B. :
Omit paragraph (a) for :-
(i) Liability only Policies.
(ii) Package Policies Where an additional premium has been paid for inclusion of damage by overturning.

Note :
* Insert make, number or some other means of identification.

Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade omit from
paragraph (a) (the words “resulting from overturning” and “except for loss … or theft”.
Alternate wording: It is hereby declared and agreed notwithstanding anything to the contrary contained in this policy that in respect of the vehicle insured * the Insurer
shall be under no liability unless an additional premium has been paid for inclusion of damage by overturning

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the operation as a tool of such vehicle or plant forming part
of such vehicle or attached thereto except for loss or damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.
b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in respect of liability incurred by the insured arising
out of the operation as a tool of such vehicle or of plant forming part of such vehicle or attached thereto.

For Package Polices where damage by overturning whilst in use as a tool of trade is excluded (Say IMT 47-C):

IMT 47-C: Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies / Shovels / Grabs / Rippers

It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect
of the vehicle insured * the Insurer shall be under no liability

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the
operation as a tool of such vehicle or plant forming part of such vehicle or attached thereto except for loss or
damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.

b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in
respect of liability incurred by the insured arising out of the operation as a tool of such vehicle or of plant
forming part of such vehicle or attached thereto.

N.B. :
Omit paragraph (a) for :-
(i) Liability only Policies.
(ii) Package Policies Where an additional premium has been paid for inclusion of damage by overturning.

Note :
* Insert make, number or some other means of identification.

Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade omit from
paragraph (a) (the words “resulting from overturning” and “except for loss … or theft”.

Alternate wording: It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect of the vehicle insured * the Insurer
shall be under no liability.
 a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the operation as a tool of such vehicle or plant forming part
of such vehicle or attached thereto except for loss or damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.
b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in respect of liability incurred by the insured arising
out of the operation as a tool of such vehicle or of plant forming part of such vehicle or attached thereto

Where the damage whilst in operation as a tool of trade is excluded by offering reduction in premium (Say IMT
47-D):

IMT 47-D: Excavators / Drilling Rigs / Mobile plants / Excavator / Navvies / Shovels / Grabs / Rippers

It is hereby declared and agreed not withstanding anything to the contrary contained in this policy that in respect
of the vehicle insured * the Insurer shall be under no liability

a) Under Section I of the policy in respect of loss or damage resulting from overturning arising out of the
operation as a tool of such vehicle or plant forming part of such vehicle or attached thereto except for loss or
damage arising directly from fire, explosion, self ignition or lightning or burglary housebreaking or theft.

b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in
respect of liability incurred by the insured arising out of the operation as a tool of such vehicle or of plant
forming part of such vehicle or attached thereto.

N.B. :
Omit paragraph (a) for :-
(i) Liability only Policies.
(ii) Package Policies Where an additional premium has been paid for inclusion of damage by overturning.

Note :
* Insert make, number or some other means of identification.

Where a premium reduction is allowed for exclusion of damage when in use as a tool of trade omit from
paragraph (a) (the words “resulting from overturning” and “except for loss … or theft”.

Alternate wording: It is hereby declared and agreed notwithstanding anything to the contrary contained in this policy that in respect of the vehicle insured * the Insurer
shall be under no liability

a) Under Section I of the policy in respect of loss or damage arising out of the operation as a tool of such vehicle or plant forming part of such vehicle or
attached thereto.
b) Under Section II except so far as is necessary to meet the requirements of the Motor Vehicles Act, 1998, in respect of liability incurred by the insured arising
out of the operation as a tool of such vehicle or of plant forming part of such vehicle or attached thereto.

Hence understand that IMT 47 would be or should be there in all eight categories of vehicles. As a thumb rule formula
for the present application of this endorsement, it can be summarized that if the premium is paid, overturning cover
is included whilst being used as a tool of trade and if a reduction in premium is given, damage whilst being
used as a tool of trade is not covered.

Once again some doubts will arise for few and they are:
 Whether all the damage caused to the vehicle is payable when the vehicle is in use and the policy is having
IMT 47?
o The surveyor or claim processor should see whether the vehicle is used in normal course of operation
or as a tool of trade
 Whether damage caused whilst in use as a tool of trade is payable with the policy having IMT 47?
o If additional premium is paid, it is covered
o If reduction in premium is given, it is not payable
 Whether damage caused by overturning is payable under IMT 47?
o General damage caused by overturning is payable
o Damage caused whilst in operation as a tool of trade is not payable unless extra premium is paid.
 All other claims caused by the specified perils in the policy are payable.

Example 1: If the equipment capsizes by other reasons - that is hit by another vehicle, when the machine is doing the
work as tool of trade, the claim is payable. The peril operated is here is accidental external means.

Example 2: In another case, the machine is not doing the operation of tool of trade but it is marching to other place
and gets capsized due to negligence of the operator. Here, the claim is payable. Here, the machine is not
operated as a tool of trade. Hence overturning or any damage caused by any of the ten perils under Section I of
the motor policy is admissible.
I believe, any person who has read this article understood about IMT 47 clearly. Still if anyone would like to discuss or
have different opinion, I am willing to explain further. As suggested, if the IMT 47A, 47B, 47C and 47D are
appropriately incorporated in the policy, confusions can be avoided.